Federal Maritime Commission.
This rule implements the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996. The rule adjusts for inflation the maximum amount of each statutory civil penalty subject to Federal Maritime Commission (Commission) jurisdiction in accordance with the requirements of that Act.
Effective July 11, 2014.
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FOR FURTHER INFORMATION CONTACT:
Karen V. Gregory, Secretary, Federal Maritime Commission, 800 North Capitol Street NW., Room 1046, Washington, DC 20573, (202) 523-5725.
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This rule implements the Debt Collection Improvement Act of 1996 (DCIA), Public Law 104-134, Title III, section 31001(s)(1), April 26, 1996, 110 Stat. 1321-373. The DCIA amended the Federal Civil Penalties Inflation Adjustment Act of 1990 (FCPIAA), Public Law 101-410, Oct. 5, 1990, 104 Stat. 890, 28 U.S.C. 2461 note, to require the head of each executive agency to adopt regulations that adjust the maximum civil monetary penalties (CMPs) assessable under its agency's jurisdiction at least every four years to ensure that they continue to maintain their deterrent value.
The Commission last adjusted each CMP subject to its jurisdiction effective July 31, 2009. (74 FR 38114, July 28, 2009).
The inflation adjustment under the FCPIAA is to be determined by increasing the maximum CMP by the cost-of-living, rounded off as set forth in section 5(a) of that Act. The cost-of-living adjustment is the percentage (if any) for each CMP by which the Consumer Price Index (CPI) 
for the month of June of the calendar year preceding the adjustment, exceeds the CPI for the month of June of the calendar year in which the amount of such CMP was last set or adjusted pursuant to law.
One example of an inflation adjustment is as follows. Section 13 of the Shipping Act of 1984 (1984 Act), 46 U.S.C. 41107, imposes a maximum $25,000 penalty for a knowing and willful violation of the 1984 Act which was inflation adjusted in 2009 to $40,000. First, to calculate the new CMP amounts under the amendment, we determine the appropriate CPI-U for June of the calendar year preceding the adjustment. Given that we are adjusting the CMPs in 2013, we use the CPI-U for June of 2012, which was 229.478. The CPI-U for June of the year the CMP was last adjusted for inflation must also be determined. The Commission last adjusted this CMP in 2009, therefore we use the CPI-U for June of 2009, which was 215.693. Using those figures, we calculate the cost-of-living adjustment by dividing the CPI-U for June of 2012 (229.478) by the CPI-U for June of 2009 (215.693). Our result is 1.0639.
Second, we calculate the raw inflation adjustment (the inflation adjustment prior to rounding) by multiplying the maximum penalty amount by the cost-of-living adjustment. In our example, $40,000 multiplied by the cost-of-living adjustment of 1.0639 equals $42,556.
Third, we use the rounding rules set forth in Section 5(a) of the FCIPAA. In order to round only the increase amount, we subtract the current maximum penalty amount ($40,000) from the raw maximum inflation adjustment ($42,556), equaling $2,556. Under Section 5(a), if the penalty is greater than $10,000 but less than or equal to $100,000, we round the increase to the nearest multiple of $5,000. Therefore, the maximum penalty increase in our example is $5,000.
Finally, the rounded increase is added to the maximum penalty amount last set or adjusted. Here, $40,000 plus $5,000 equals a maximum inflation adjustment penalty amount of $45,000.
A similar calculation was done with respect to each CMP subject to the jurisdiction of the Commission. In compliance with the FCPIAA, as amended, the Commission is hereby amending 46 CFR 506.4(d) of its regulations which sets forth the newly adjusted maximum penalty amounts.
This final rule has been issued without prior public notice or Start Printed Page 37663opportunity for public comment. Under the Administrative Procedure Act (APA), 5 U.S.C. § 553(b)(B), a final rule may be issued without that process “when the agency for good cause finds (and incorporates the finding and a brief statement of reasons therefore in the rules issued) that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest.” In this instance, the Commission finds, for good cause, that solicitation of public comment on this final rule is unnecessary and impractical.
Specifically, the Congress has mandated that the agency periodically make the inflation adjustments and does not allow for the exercise of Commission discretion regarding the substance of the adjustments. The Commission, under the DCIA, is required to make the adjustment to the civil monetary penalties according to a formula specified in the statute. The regulation requires ministerial, technical computations that are noncontroversial. Moreover, the conduct underlying the penalties is already illegal under existing law, and there is no need to provide thirty days prior to the effectiveness of the regulation and amendments to allow for affected parties to correct their conduct. Accordingly, the Commission believes that there is good cause to make this regulation effective immediately upon publication.
The Regulatory Flexibility Act (RFA), as amended by the Small Business Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 801 et seq., generally requires an agency to prepare a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Because the Commission has determined that notice and comment are not required under the APA for this rulemaking, the requirements of the RFA do not apply and no regulatory flexibility analysis was prepared.
The rule does not contain any collection of information requirements as defined by the Paperwork Reduction Act of 1995, as amended. Therefore, Office of Management and Budget review is not required.
This regulatory action is not a major rule as defined under 5 U.S.C. 804(2).
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- Administrative practice and procedure
Part 506 of title 46 of the Code of Federal Regulations is amended as follows:
PART 506—CIVIL MONETARY PENALTY INFLATION ADJUSTMENT
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1. The authority citation for part 506 continues to read as follows: End Amendment Part
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2. In § 506.4, revise paragraph (d) to read as follows: End Amendment Part
Cost of living adjustments of civil monetary penalties.
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(d) Inflation adjustment. Maximum Civil Monetary Penalties within the jurisdiction of the Federal Maritime Commission are adjusted for inflation as follows:
|United States Code citation||Civil Monetary Penalty description||Current maximum
amount||New adjusted maximum
|46 U.S.C. 42304||Adverse impact on U.S. carriers by foreign shipping practices||1,500,000||1,600,000|
|46 U.S.C. 41107(a)||Knowing and Willful violation/Shipping Act of 1984, or Commission regulation or order||40,000||45,000|
|46 U.S.C. 41107(b)||Violation of Shipping Act of 1984, Commission regulation or order, not knowing and willful||8,000||9,000|
|46 U.S.C. 41108(b)||Operating in foreign commerce after tariff suspension||75,000||80,000|
|46 U.S.C. 42104||Failure to provide required reports, etc./Merchant Marine Act of 1920||8,000||$9,000|
|46 U.S.C. 42106||Adverse shipping conditions/Merchant Marine Act of 1920||1,500,000||1,600,000|
|46 U.S.C. 42108||Operating after tariff or service contract suspension/Merchant Marine Act of 1920||75,000||80,000|
|46 U.S.C. 44102||Failure to establish financial responsibility for non-performance of transportation||8,000 300||9,000 3 300|
|46 U.S.C. 44103||Failure to establish financial responsibility for death or injury||8,000 300||9,000 4 300|
|31 U.S.C. 3802(a)(1)||Program Fraud Civil Remedies Act/makes false claim||8,000||9,000|
|31 U.S.C. 3802(a)(2)||Program Fraud Civil Remedies Act/giving false statement||8,000||9,000|
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By the Commission.
Karen V. Gregory,
[FR Doc. 2014-15533 Filed 7-1-14; 8:45 am]
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